Land Is Purchased by a Business for $100,000

Multiple Choice

Land is purchased by a business for $100,000. The company pays for the land by a cash payment of $20,000 and promised to pay the remaining amount at a later period. What is net effect of this transaction on the business's accounting equation?

A) Assets increase by $100,000; liabilities decrease by $20,000.
B) Assets increase by $100,000; liabilities decrease by $80,000.
C) Assets increase by $80,000; equity increases by $80,000.
D) Assets increase by $80,000; liabilities increase by $80,000.